Cryptocurrency coming under increasing scrutiny

Bitcoin and other cryptocurrencies are coming under increasing scrutiny from financial regulators in the US, thanks to their increasing popularity as an investment (rather than a currency):

Cryptocurrencies are under the microscope as never before. Financial regulators in the US are concerned about the emergence of bitcoin and its digital cousins as speculative investments and have hinted that much tougher regulation is in the pipeline.

Last week, the Securities and Exchange Commission (SEC), which regulates the New York financial markets, issued an alert, saying it was “cautioning market participants that offers and sales of digital assets by ‘virtual’ organisations are subject to the requirements of the federal securities laws”.

The message was that selling coins issued by a digital currency provider and selling shares on the stock exchange amount to pretty much the same level of risk. This sent tremors through the digital currency industry.

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